Taking off in new directions
With the company going truly global, but withdrawing from its historic steel business, Guest, Keen and Nettlefolds took a modernising step and officially changed its name to GKN plc. And it took historic steps into new business territories.
In 1988, GKN acquired a stake in Westland plc, the British helicopter and aerospace manufacturer. Westland was known worldwide for its helicopters, but it had previously acquired Saunders Roe – the famous flying-boat maker (later renamed Westland Aerospace Ltd) – which was at the leading edge in aerostructures and composite materials.
The move into aerospace technology continued the shift away from heavy engineering that had begun in the 1980s and continued through the recession of the early 1990s. A host of non-core operations, notably in industrial services, were sold or closed cutting the global workforce from 93,000 in 1980 to 32,300 in 1990.
GKN was now focused on a few growth businesses: Driveline, Chep, Cleanaway, Aerospace/Defence and Off-Highway, which had developed from the original Sankey operation. Strategic moves expanded Chep into the potentially vast American market and Driveline into post-communist Eastern Europe. Powder Metallurgy and Sinter Metals were identified as a potential core activity and the company embarked on a rapid expansion through acquisition, mainly in the US, but later in Europe.
The expansion into new areas drew GKN closer to a new Rubicon. Chep, now thriving in the US, was a huge joint venture that GKN did not completely control; the helicopter industry was rapidly consolidating; the aerostructures business needed to stay at the leading edge.
In 2001, an extraordinary few months of hyper-activity re-shaped the business for the 21st century. In a multi-billion pound deal – the biggest in the company’s history – Chep and Cleanaway were de-merged; Westland’s helicopter business was merged into a joint venture with Agusta, owned by the Italian group Finmeccanica. And Boeing’s military aircraft structures plant in St Louis was acquired in a groundbreaking outsourcing deal.
It was the most fundamental re-shaping for a century and focused GKN on four world-leading businesses: Driveline, Aerospace, Powder Met and Off-Highway.